Tesla Hopes To Finalize China Factory Location By Mid-2016
Elon Musk said recently that Tesla Motors is searching for a local partner and location for a factory in China.
Establishing a joint ventrue to assemble the cars in China is seen as a way to avoid high import duties, as well as to catch onto incentives available only for Chinese EVs manufacturers. With the restrictions in place today, there is currently no business model that supports volume sales for automobiles imported into China.
Apparently are just months away from the announcement of a joint venture partner because Tesla is in a hurry according to an interview by CEO Elon Musk to Engadget:
“… he (Musk) aims to lock down manufacturing plans — finding a local partner and a location for the plant — for the local market by middle of this year. As with most other foreign auto makers who do business in China, this key strategy is to waive the high import duties charged by the local government, as well as to access other local incentives for EVs. Until then, Musk said there’s no further news to share on that end.”
Tesla CEO said the automaker is “doing reasonably well” in China, but the 2016 sales target was set at only 5,000 cars illustrates that without regional production there is certainly a theoretical cap in place.
The question now would be the scale of manufacturing facilities in China, as Tesla already has a full plate with the building of its Gigafactory in Nevada, as well as bringing the company’s first high volume affordable EV to market.
We would expect that (at least in the beginning), China operations would have a blend between some location production of parts and how things operate currently at Tesla’s European Tilburg Factory, which simply assembles the cars from parts shipped from California.
Tesla Model X deliveries in Hong Kong are to begin by the end of 2016.
Here are some new stats report by the CEO from Hong Kong this week (check out our live recap of the event here):
- over 340 Superchargers stands (96 stations according to the supercharge.info)
- over 1,600 destination chargers
- 15 stores in 7 major cities
- Macau store opening soon